DraftKings To Develop Sportsbook Near Wrigley Field
DraftKings will work to develop a flagship retail sportsbook near Wrigley Field as part of a deal that makes it the Cubs' official sports betting and daily fantasy provider. The exclusive multiyear marketing agreement includes broadcast and digital advertising, in-venue signs, hospitality and use of Cubs logos, as well as rights to open the retail location. Financial terms were not disclosed. Signed into law in June '19, Illinois’ sports betting framework allows for licenses for retail sportsbooks within five blocks of as many as seven larger sports venues, including Wrigley Field, Guaranteed Rate Field, Soldier Field and United Center, at a price of $10M each. DraftKings and the Cubs still must receive city approval in order open a retail sportsbook, which they envision as a large restaurant, bar and betting venue that fans can visit before and after games and that the development-minded Cubs view as a year-round attraction. “It will be a destination,” said DraftKings co-Founder & President Matt Kalish. “It’s something that we want to make a statement with, so we want to do it right. Whatever it takes to build the best sportsbook in the country, that’s what we’re looking to do.”
LOGICAL ADDITION: Cubs execs see the sportsbook as a logical addition to the ballpark’s Gallagher Way development, which includes a well-received boutique hotel and several restaurants, all within view of Wrigley. That real estate project has driven increased activity when the Cubs are on the road and in the offseason, especially through December, when the weather is mild enough for outdoor activity. The execs see a sportsbook as a way to bridge the gap between the winter holidays and the start of baseball season. “We have a slackened market from January to the beginning of baseball,” said Cubs President Crane Kenney. “What really helps us there is that the Super Bowl and March Madness are in that three months of the year (with) a very active indoor environment, where folks are staying in and watching their teams and now betting on their teams.”
PRIME TARGET: Even without the retail location, which likely would not open before '22, DraftKings saw the Cubs as a prime vehicle to attract customers, especially during the pandemic, with state betting regulations in flux. DraftKings secured access in Illinois through a deal with Casino Queen in East St. Louis. Under the state’s original regulations, meant to handicap legacy DFS brands DraftKings and FanDuel and favor the state’s brick-and-mortar casinos, bettors could only open and fund sportsbook accounts by registering in person at a casino. Chicago bettors would face a nine-hour round trip drive in order to open a DraftKings account. Rather than encouraging face-to-face indoor encounters during the pandemic, Illinois Gov. J.B. Pritzker last month lifted the in-person requirement, allowing bettors statewide to sign up for DraftKings. But Kalish conceded that Pritzker could reverse that decision in favor of the casinos, as he did for three weeks earlier this summer. Pritzker’s current suspension of the in-person registration requirement is scheduled to expire Sept. 18. FanDuel Sportsbook and BetRivers also are up and running online in Illinois. Others, including PointsBet, are expected to launch soon. "Sports betting is live now in Illinois and I think (the Cubs) are the best partner you could have in the state,” Kalish said. “We’re trying to make the most of this time. It encompasses NFL week one, which is a massive activation window for us.”
EXCLUSIVE DEAL: The Cubs bucked trend when they opted to grant DraftKings exclusivity in the sportsbook category. Typically, teams across sports have divided the category into at least three, often signing a land-based casino brand and two online operators, parceling out assets in ways that fit their often differing strategies. The Cubs chose to treat the category as they do other large ones, such as beer and airline, where Anheuser Busch and American Airlines have marketing exclusivity. Kenney said, "We really don’t want to see Wrigley turn into some kind of a NASCAR -- 150 different partners in the ballpark. We like bigger, deeper, more exclusive relationships. That’s what has worked for us. I know plenty of other venues have had success using multiple vendors and multiple partners and promoting multiple brands at the same time, sometimes in competition with one another. That hasn’t been our MO. We like the deep relationship with someone who is best-in-class and then we put all our energy into supporting them. That’s kind of the route we went here.”
TOUCHY SUBJECT: With a population of 12.7 million, Illinois is only slightly less populous than Pennsylvania, the largest state to legalize sports betting. Chicago is the largest U.S. metro area in which it is allowed. While DraftKings will have an exclusive marketing relationship with the Cubs and be the only retail sportsbook allowed within five blocks of Wrigley, Illinois law does not appear to prevent bettors from using other mobile sportsbooks within that footprint. That has been a prickly aspect of regulations in DC, which allow for geo-tracking restrictions that block all but the DC lottery’s mobile sportsbook app once a bettor leaves a sports venue. The DC law also allows exclusivity for a single sportsbook within each venue.
WHAT OTHERS ARE SAYING: ESPN.com's David Purdum notes the exact location of the sportsbook is unknown, and since there are "several regulatory steps still needed, no specific timeline is in place." As the Cubs' designated sports operator, DraftKings "must apply for a master sports wagering license with the Illinois Gaming Board." It is yet to be determined how and if the revenue from the sportsbook "will be shared between DraftKings and the Cubs." The CHICAGO TRIBUNE’s Phil Rosenthal writes there is “likely is to be scrutiny" of the sportsbook project from the Commission on Chicago Landmarks. The Cubs said that the new facility "would offer online access in the area surrounding the ballpark." FORBES.com's Jared Wyllys writes this will "add to the many changes the Ricketts family has already made to the immediate neighborhood around Wrigley Field."